So most of my posts are and will be about my men... but I read this at work today and found it quite interesting. It's basically comparing the Great Depression to how the economy is today... you'll be suprised. So stop hoarding you're money and BE SMART! INVEST AND CONSUME!
Notable Numbers for the Week:
1. BORROW AND BUY - An estimated 40% of stock investors were purchasing equities by using borrowed funds (i.e., margin accounts) in 1929 at the time of the crash. Margin debt on the New York Stock Exchange hit an all-time high of $381 billion in July 2007 but was down to $292 billion by the end of August 2008. Total margin debt was $279 billion when the stock market peaked in March 2000 (source: Wall Street Journal, NYSE).
2. JOBLESS - The unemployment rate in the US during the Great Depression reached 25%. Even as the decade of the 1930s was ending, the nation’s unemployment rate was still close to 15%. The unemployment rate in the US is 6.1% today (source: Wall Street Journal, Newsweek, Department of Labor).
3. GONE - 40% of US banks failed during the 5-years from 1929-1933. The Federal Deposit Insurance Corporation, guaranteeing an individual’s account up to a maximum threshold of $2,500 initially, was signed into law on 6/16/33 and became effective on 1/01/34, too late for thousands of US citizens (source: Newsweek, FDIC).
4. IRONIC - When Ben Bernanke took over a vacant slot on the Federal Reserve’s Board of Governors in August 2002, he was required to set aside the 120 pages he had written for a book that he began 2 years earlier. A New York City publisher had paid Bernanke an advance on a book that was to be titled “Age of Delusion: How politicians and central bankers created the Great Depression” (source: Wall Street Journal, Federal Reserve).